Nick Cowen

He/him. Classical criminologist. Author: Read how good policing stops crime here:

[Nick Cowen @nc0we]

Neoliberalism and social justice. My talk and Q&A at the LSE: https://t.co/mFitNbXfgs

[Brian Albrecht @BrianCAlbrecht]

A "compute tax" fails on basically all the basics of optimal taxation.

- Don't tax capital
- Don't tax intermediate goods
- Don't tax easily manipulable things
- Don't tax small tax bases

Overall, a dumb idea.
https://t.co/v3lNfI8anq

[David Weigel @daveweigel]

Since 2022, the share of Republicans saying "gay or lesbian relations" are "morally acceptable" has plunged from 56% to 35%.

[Mithras ☩ @Heliodromus101]

Please be careful sharing the names PC Christi Hill & Tristan Parsons in the Henry Nowak case. They were not the officers involved — Hill had already left the force in 2024, and the video/photo is from a 2021 bravery awards event.
The real officers are under IOPC investigation ……..

[Nick Cowen @nc0we]

This is what a supportive business environment can do for a country’s public finances

[Marco De Donno @stonksandgoats]

@citrini What it means for the Korean economy and people when Samsung and SK Hynix are about to pay $430 BILLION in taxes in FY26-28.

That's half the Korean public debt.

[Nick Cowen @nc0we]

@SCP_Hughes Fascinating, Samuel. Never has the notion of social structure been so… concrete.

[Ed Hezlet @watt_direction]

What’s the biggest barrier to decarbonising Britain?

We think it’s expensive electricity.

@BritishProgress have 4 policy ideas to cut household bills by £115, and save businesses 7%.

But bill reductions must come alongside market reform - to ensure long term value for money.

[Gareth Corfield @GazTheJourno]

Labour stopped rail firms buying cheap fuel before Iran war, insiders tell the Sunday Telegraph.

Train operating companies who sought to hedge fuel purchases were blocked from doing so, senior sources allege. 🧵...

[Jacob Bard-Rosenberg @Prolapsarian]

THREAD: The collapse of higher education in the UK is misunderstood by almost everyone involved. We are told it is because of volatile international student markets. The truth is more to do with real estate and capital investment. Here is what is going on: in places like the US

[Jesús Fernández-Villaverde @JesusFerna7026]

How has the Spanish economy performed over the very long run?

To answer, I use Leandro Prados de la Escosura’s (@LdelaEscosura) data on real GDP per capita from 1277 to 2024. I express Spain’s figure as a ratio to Britain’s, since Britain was the first economy to achieve modern economic growth, from around 1660, and has been the leader, or close to it, ever since.

Spain, within its present borders, was prosperous in the Late Middle Ages, well ahead of Britain, then a peripheral corner of Europe. The Black Death and its aftermath hit Spain harder, and by 1360, the two economies had converged.

That parity held until 1600, when Spain began a long decline, in absolute terms (on the eve of the French Revolution, it was barely above its 1600 level, after a deep slump in between) and in relative terms (Britain pulled steadily away). The standard explanations, the Habsburg wars, and the serial bankruptcies run into one problem. They can account for the poor performance between 1550 and 1650, but not for the stagnation between 1650 and 1789. 140 years of stagnation is far more than wars and debt under the Habsburgs can explain.

The series also shows that Spain did not benefit from its empire. That is a problem for every theory tying colonies to modern growth. At most, one can argue that colonies were a necessary condition for takeoff (I do not believe even that, but leave it for another day). One cannot argue that they were sufficient.

The period from 1789 to 1936 was no kinder. The economy grew a little, and Spain built a modern but unfinished liberal state. Yet it never closed the distance to Britain. It is hard not to read the period from 1789 to 1936 as a national failure and the Civil War as its final consequence.

The recent efforts of some historians to paint those years in brighter colors strike me as unfounded. Spain did not fail at modernization as badly as China, but it did not succeed. A deeply corrupt dynasty, closed and incompetent elites in Madrid, Barcelona, and Bilbao, and an economic policy built on intervention and protection (by 1920, Spain was the most protectionist economy in the Western world, so much for the friends of protection) together made the country a basket case.

A cruel civil war left Spain at its historical low, with just 31% of the British GDP per capita. The foreign visitors who arrived in the early 1950s found a poor, backward country.

Policy in the first twenty years of the dictatorship was awful. Autarky was not so much imposed by the Allies as chosen. Spain’s rulers, using their quasi-fascist Weltanschauung, believed growth would come from state intervention, closed markets, and unorthodox fiscal and monetary policy.

Then, in 1959, policy changed. Spain adopted a more orthodox fiscal and monetary policy and opened to foreign investment and trade. The results were spectacular. For forty years, Spain grew briskly and became the modern country it is today. By 2001, it had reached 77% of British GDP per head.

But the internal contradictions of two things eventually became binding: the growth model launched in 1959, and the political regime created by the 1978 constitution. By 2024, Spain had slipped back to 74% of British GDP per head. This is worse than it looks. Britain itself has done poorly over the past twenty years, and losing ground to a weak performer is a bad sign.

Spain stands at a crossroads, economic and political. The country’s foundations no longer work, but its political and business elites have failed to understand this fundamental reality. A good grasp of its economic history helps make sense of its present predicament.

[Dr Lawrence Newport @lawrencenewport]

Yes, this data is currently hoarded by central gov and locked behind significant hurdles.

Young people deserve better!

Time to release the records!

[Eduin Latimer @LatimerEduin]

This is most striking figure from Millburn Review. They estimate that around half of the 18-24 population who are not in education, employment or training (NEET) are not claiming any benefits. This limits how effective reforms to the benefit system can be in cutting NEET rates.

[Hampshire Police @HantsPolice]

Today, a man has been convicted of the murder of student Henry Nowak in Southampton. Throughout the trial, we have not discussed this case publicly to ensure that justice could be done but now we can share a message from DCC Robert France.

https://t.co/13203Yq9DA

[Dan Neidle @DanNeidle]

Britain has a tax on instruments that don’t exist any more.

It raises no revenue. It never applies. It was meant to be abolished this year, but wasn't.

It still exists.

Anyway, I made a chart of all 85 UK taxes.

[Philip Salter @Philip_Salter]

Some policy areas are neglected. Others are tinkered with to death. Capital gains tax sits firmly in the second camp. In the last fifteen years, the headline CGT rate has been raised, cut, raised again, and split into multiple sub-rates. And now equalising it with income tax is being seriously discussed in Westminster again.

Entrepreneurs’ Relief was introduced with a £1 million lifetime cap, expanded to £2 million, then £5 million, then £10 million, then cut back to £1 million, then rebranded as Business Asset Disposal Relief (BADR), then ratcheted from 10% to 14%, to 18%. The last clean settlement was Lawson in 1988. Every Chancellor since has felt obliged to fiddle.

BADR is now capped at a level low enough to be irrelevant for serious scaling, and has been continuously revised in ways that signal political instability to anyone considering where to base their business. We have, in effect, the worst of both worlds.

The behaviour the Treasury actually wants — or should — is reinvestment. Capital gains are taxed differently from labour income to attract entrepreneurs from abroad, keep the ones we have, and incentivise them to do it again. In our recent Entrepreneurs Survey, 72% of founders told us they would invest the proceeds of a more generous BADR in someone else’s startup, while 70% said they would launch a new venture. The reinvestment instinct is overwhelming, and it is the thing the UK tax system most needs to protect.

The case for equalising CGT with income tax comes dressed in sophisticated economics: get the base design right — exempt a “normal” return on capital through a rate-of-return allowance, make losses more generously offsettable — and the headline rate stops mattering. It is a serious argument. It is also, as the tax policy expert Tom Clougherty argued in The Times, one that does not survive contact with how entrepreneurship actually works.

On losses, Clougherty notes the basic asymmetry: “an entrepreneur’s potential losses are uncapped; their upside is highly uncertain. If you tax the gains without subsidising the losses (and you should definitely not subsidise losses) you are skewing incentives around risk-taking.” On the rate-of-return allowance, his point is even sharper: it “assumes that any returns above a ‘risk-free’ rate are ‘unearned rents’ — unrelated to skill, effort, or the risks taken. This assumption does not hold up in the real world. High returns on capital are not random strokes of luck — often they are a manifestation of precisely the qualities that drive economic progress.”

That is the substantive case. Then there is the practical one. The most carefully designed CGT regime in the world is useless if founders can’t plan around it. A founder building a company is making a ten- to fifteen-year bet. The UK tax system has been resetting every year.

CGT does more than raise revenue. It tells founders what the country thinks long-term, illiquid, risk-bearing capital is worth. A regime that keeps changing tells them something else: that the tax treatment of their decade-long bet will turn on a single Budget, election or leadership race.

The behavioural evidence is visible. Pre-Budget realisation spikes are now a standard feature of UK tax data, as founders rush to crystallise gains ahead of expected changes. The 2024 spike was the largest on record. Our own polling found that 62% of founders personally know an entrepreneur who sold up or left the UK after the 2024 Budget. Seven in ten know one planning to leave because of the current or expected tax regime. None of this is hypothetical — which is why over a thousand of Britain’s most ambitious founders, including those behind Synthesia, OakNorth, Zopa and CMR Surgical, signed our letter to the Chancellor when this was last being seriously considered.

Clougherty puts the pattern starkly: “If you look at the blended marginal tax rate on capital income — combining the effects of corporation tax, CGT and dividend tax — since 2000, you see two big spikes: one immediately after the financial crisis, and another after the pandemic. Why do we keep responding to economic crises by hiking taxes on investment? Could this possibly have anything to do with our failure to bounce back from these downturns?”

A tax system can be defensible at every point in time and still be impossible to plan around, because founders are not pricing today’s rate — they are pricing the range of rates they expect to face over the next decade. Britain has spent 15 years teaching them to expect the worst.

Sweden faced the same question in 2003: how to tax founder gains without choking off new ventures. It didn’t cut the rate. It changed when the rate applied. Corporate tax on capital gains from selling shares in unlisted companies was deferred indefinitely, provided the proceeds went back into other unlisted companies. Founders who exit and consume pay tax. Founders who exit and reinvest defer it.

As Luis Garicano and Per Strömberg set out, Sweden — a country of 10 million — has produced more unicorns per capita than almost anywhere in the world. Alumni of the first wave of Swedish tech successes have founded and funded the second because the 2003 reform let them recycle exit proceeds at scale. It worked because it targeted people who already had deal flow, judgement and operating experience — and because, crucially, it has been left largely alone for over two decades. Reward reinvestment, then get out of the way.

This isn’t a left-right argument. One of Mark Carney’s first acts as Canadian Prime Minister, in March 2025, was to cancel his predecessor’s planned increase to the capital gains inclusion rate. The centre-left Carney framed it as catalysing investment and rewarding the people who take risks to build things.

The Treasury will point out that income reclassification through closely held companies is a real problem. They are right. Owner-managers can dress up labour income as capital gains to lower their tax bill, and the rate gap creates the opportunity. But the answer is not a blunt rate hike on every capital gain. It is to fix the specific structures that allow the reclassification in the first place. Punishing genuine entrepreneurship to close a definitional loophole is a category error.

Any reform has to pass two tests: does it keep founders building and reinvesting, and can they plan around it for a decade? Everything else is just tinkering.

[reason @reason]

Samurai vs. Squatters: On the street with the hired swords reclaiming California property owners' stolen homes.

California has failed to protect private property from squatters. Desperate owners are turning to katana-wielding enforcers to reclaim their homes: https://t.co/RPYs7cH5SI

[Aria Schrecker @Aria_Babu]

The ceiling fell into my childhood bedroom. I asked Claude to estimate the value of all the books for an insurance claim (£2250).

I then asked Claude to make some guesses about me based on the books. It was basically correct about everything. (Except it attributed my interest in politics to my parents.)

Otherwise it got my age, the parent interested in history, the connection to Wales and the teenage flirtation with veganism.

[Stakeholder Consultant @echetus]

In the 16th and 17th centuries, tourism was unheard of, highly suspect, and potentially criminal.

[Pedro Serôdio @pdmsero]

Even if AI surpasses humans at every cognitive task, human labour might not disappear.

Comparative advantage is part of the reason why - it may be economically rational to combine different inputs. The deeper part is the structure of firms, which most discussions skip.

[Nick Cowen @nc0we]

https://t.co/mC5IWIP6w1

[Nick Cowen @nc0we]

@jujulemons @GeorgeMonbiot @dc_lawrence Not a good look